TL;DR

A company with massive losses boasts a $7B valuation, defying logic and echoing past financial crises. It’s a story of manipulation, reminding us that blind faith in markets can lead to devastating consequences.

Story

John, a retired teacher, dreamt of peaceful days. Instead, he faces financial ruin, thanks to a company’s baffling $7 billion valuation despite a $400.9 million loss. How? Let’s dissect this.

This story isn’t about sound business; it’s about manipulation. The company, using the former president’s name, trades on pure emotion, not fundamentals. Think of it like a casino where the house always wins, except the house is built on blind faith.

‣ Fundamentals: A company’s financial health—revenue, profits, etc. Think of it as a car’s engine.

The company’s annual report paints a grim picture: revenue down 12%, losses widening. Yet, its market cap soars. This defies logic, resembling the 2008 housing bubble, where inflated values masked underlying rot. Like a house of cards, it’s all set to tumble.

‣ Market Cap: Total value of a company’s shares. Imagine it’s a house’s price tag—often misleading.

Many suspect darker forces at play—bribery, money laundering, etc.—all dressed up in a stock ticker. It’s reminiscent of Enron, where accounting tricks hid a crumbling empire. John, like countless others, is caught in this web of deception.

‣ Money Laundering: Making illegally obtained money appear legal. Think of it as washing dirty cash.

Sadly, there’s little recourse for John. This situation exposes regulatory gaps, reminding us of the need for constant vigilance and skepticism in the financial world. History repeats itself, and if it looks too good to be true, it probably is.

Advice

Don’t fall for hype. Scrutinize fundamentals. If a company’s performance doesn’t justify its valuation, run—don’t walk—away.

Source

https://www.reddit.com/r/stocks/comments/1ipv7x6/djt_lol_how_is_this_possible/